Best Agrolife delivers strong FY2023 performance with 44% sales growth

Best Agrolife Limited (BAL) (BSE: 539660, NSE: BESTAGRO) reported financial results for the Quarter and Year ended March 31st, 2023.

Consolidated Financial Results – FY23 & Q4

Commenting on results, Mr. Vimal Alawadhi, Managing Director, Best Agrolife Limited, said: ″I am delighted to inform you that we have delivered strong revenue from operations of Rs. 1,746 cr. which is a robust growth of 44% over FY22. Our constant focus on introducing the innovative products to cater to farmers need has resulted in BAL introducing many specialised combination products including patented novel combination Ronfen in FY23 which drove the growth during the year. We have also expanded our margins by 427 bps during the year which was driven by change in product mix.

Happy to mention, Board has recommended a dividend of 30% (i.e. Rs.3 per share), which is 50 % jump over last year.

Q4FY23 was difficult for the industry at large due to higher channel inventory and excess supply from China at lower prices. We were also affected by this as our branded product portfolio is more focused on the kharif season. We are working towards introducing more branded products which are focused on Rabi season which will improve breadth of the portfolio and will also make the portfolio more balanced which is currently skewed more towards kharif season. 

In line with our commitment to ″Make in India″, we have embarked on a capex plan to expand our technical capabilities as well as improve backward integration which will lead to lower dependence on China and better cost structure. 

Overall, we have an exciting product pipeline ready to be launched in FY24 which are in line with our strategy of introducing more patented and specialised combination products which will help continue strong growth momentum as well as improve our margins in FY24.″  

Key Results Highlights (FY23 Consolidated):

• Revenue from operations for FY23 grew by 44% YoY to Rs. 1,746 cr. 

• Gross margin for the year is at 28% as compared to 19% in FY22 which was an expansion of 963 bps YoY.

• EBITDA for the year came at Rs. 314 cr up 89% YoY compared to Rs. 166 cr in FY22. 

• EBITDA margin for the year came at 18% as compared to 14% in FY22; expansion of 427 bps YoY. 

• PAT for the year was at Rs. 192 cr up 83% on YoY basis. PAT margin for the year was at 11% compared to 9% in FY22.

Key Business highlights for FY23:

• Products Launched during FY23:

• Launched a first-of-its-kind proprietary ternary insecticidal combination — Ronfen.  Ronfen is a single-shot solution that controls all sucking pests in various crops like cotton, chilly, vegetables, and many other segments having addressable market of ~Rs. 8,000cr. 

• Best Group became the first company to launch CTPR based formulations CITIGEN & VISTARA in domestic market. This single molecule has around Rs 2,800 cr. domestic market. 

• BAL also launched niche combination products such as Tambo, Axeman, Warden and Reveal during FY23.

• Approvals and Registration received:

• Seedlings India Pvt Ltd wholly- owned subsidiary of BAL received a patent valid for 20 years for the first-of-its-kind fungicidal composition of Cyazofamid, Dimethomorph, and Difenoconazole which is going to emerge as a highly effective crop solution against Late Blight and Downy Mildew in tomato and grapes crops respectively. The approximate market size of this fungicidal composition is ₹350 crore.

• Granted registration for indigenous manufacturing of Pyroxasulfone technical u/s 9(3). The market size of Pyroxasulfone is approximately ₹ 450 Crore and is expected to grow in coming years. Until now India was dependent on other countries for Pyroxasulfone.

• Granted registration for the indigenous manufacturing of Propiquazafop u/s 9(3).

• Granted registration for the indigenous manufacturing of Cyhalofop-Butyl Technical, u/s 9(3).

• Capex Update:

• Board of directors approved Capex plan of Rs. 200 cr. towards brownfield expansion in the technical manufacturing unit of Best Crop Science Private Limited (a wholly owned subsidiary of the Company).

Product Pipeline for FY24:

• BAL has pipeline of 10+ products to be launched during the course of FY24 which includes couple of patented products as well as some niche combination products and technicals.